Seoul shares closed at their lowest in more than four months on Monday as foreigners again were net sellers amid fears about the ongoing slide in the yen and warnings that North Korea may conduct another nuclear test. The Korea Composite Stock Price Index (KOSPI) ended down 0.4 percent at 1,918.69 points, its lowest closing since November 28.
Han Beom-ho, an analyst at Shinhan Investment & Securities said that the long-running threats of a weaker yen and bluster from North Korea were taking a bigger toll than earlier. Movement around an atomic test site in North Korea indicates the reclusive state may stage another nuclear test, a South Korean minister said on Monday, an act that would further drive up tensions on the Korean peninsula.
Han said sentiment was further depressed when South Korea's new finance minister on Monday ruled out currency interventions to counter yen falls. The country's leading manufacturers have already been seeing their exports and profits eroded by the yen's decline, a private survey released last week showed. Overall, 607 shares declined on Monday while 215 advanced.
Utilities led the losses, falling 2.9 percent. Korea Electric Power Corp shed 3.4 percent, extending Friday's 2.4 percent fall. However, market leader Samsung Electronics was up 1 percent, as investors were upbeat about better-than-expected earnings for the January-March period, and the launch of the new Galaxy SIV smartphone. STX affiliates STX Offshore & Shipbuilding, STX Pan Ocean and STX Heavy Industries jumped on hopes that creditors would help the cash-strapped group. Among daily movers, Hana Tour sunk 9.3 percent as concerns grew about bird flu in China, a major destination for South Korean tourists. For a fourth day, foreign investors were net sellers of shares. The net sales were 373 billion won ($330 million). On Friday, there was the highest sell-off in 20 months, thanks to the Bank of Japan's planned aggressive monetary expansion and tensions on the Korean peninsula. The KOSPI 200 benchmark of core stocks was down 0.2 percent, while the junior KOSDAQ edged 3.4 percent lower.